Why Should You Invest in Blue Chip Stocks?
There are roughly 8,000 U.S. exchange-listed stocks, representing different sectors, investing styles, and risk profiles. You can custom-build any portfolio to suit your tastes.
There's a tendency, however -- particularly for newer investors -- to take on above-average risks in search of above-average gains. But before dismissing older, stodgier stocks for your portfolio, consider this.
There's no hard and fast rule about which stocks are blue chips. But generally speaking, they tend to be older, bigger companies in well-established businesses. Coca-Cola (NYSE: KO) is a blue chip, while up-and-coming solar power company Enphase Energy isn't, at least not yet. A younger, more volatile name like Tesla could arguably go either way, despite its size.
Source Fool.com
